SINGAPORE: Asian stocks tanked on Wednesday,with a record-breaking market crash in Seoul, as investors dumped crowded bets on chipmakers on worries a widening Middle East war will drive an oil shock that raises inflation and delays interest rate cuts.
Asia is heavily dependent on energy imports shipped through the near-shuttered Strait of Hormuz and nowhere was the strain clearer than in Seoul, where the session finished with the market plunging 12 percent, the largest drop on record.
Over two days the benchmark has lost more than 18 percent of its value while the currency has slumped to a 17-year low.
Japan’s Nikkei fell 3.9 percent and Taiwan stocks dropped 4.3 percent as investors raced out of what has been one of the hottest bets of the last few months in semiconductor makers — likely as cover for losses elsewhere and to cut down on risks.
“Asia’s selloff is turning disorderly because markets are no longer treating this as a ‘one-week headline shock,’ said Charu Chanana, chief investment strategist at Saxo in Singapore.
